Never short of a word, Fiat Chrysler Automobiles (FCA) CEO Sergio Marchionne has stated his company can more than match it with Tesla at the entry-level if need be.

Tesla’s first ‘people’s car’, the Model 3, was unveiled late last month with a confirmed starting price of US$35,000.

Elon Musk, Tesla CEO, estimated however that the average price of a Model 3 to US customers would be around US$42,000 once popular options and configurations were added at purchase.

For his part, Marchionne is more than happy to take Tesla on and for FCA to develop and build a direct rival for the Model 3 - but only if the business case stacks up.

"I am not surprised by the high number of [Model 3] reservations," Marchionne said, speaking with Reuters. "But then the hard reality comes in... making cars, selling them and making money doing so."

"If [Musk] can show me that it can be done, I will do it as well, copy him, add Italian style to it and put it on the market within 12 months."

Yep, you read that right - Marchionne believes FCA could have a midsized electric sedan wearing an Italian badge in showrooms within 12 months.

Sergio Marchionne

Which Italian badge Marchionne may prefer is a mystery for now, but the CEO’s bold prediction suggests FCA has more than a passing interest in the EV market. The progression of a potential Tesla-fighting model for FCA, however, is anyone’s guess.

Marchionne has made no secret of his desire to merge FCA with another carmaking group, and the company boss has now reportedly narrowed the choice down to three.

The lucky contestants are Ford, Toyota and the Volkswagen Group. Marchionne’s other preferred option, General Motors, has already rejected the idea.

"The door has never closed, the need to consolidate does not go away," Marchionne said, citing his belief that carmakers will die if they don’t merge to reduce development costs.

Ford was reportedly quick to distance itself from a potential merger with FCA.

While Marchionne did not say so directly, it appears the world’s other sizable automotive conglomerates - France’s PSA Groupe (Citroen, Peugeot and DS) and the Renault-Nissan Alliance - are out of the picture, for now.

As for the Hyundai / Kia partnership, Marchionne said “the Koreans don’t get married”.